Closing and Final Details
Closing is the Day You’ve been Waiting For
Your Associate may accompany you to settlement, which will be led by a closing agent (escrow officer) and typically an attorney or title company representative. He or she will complete the transaction by assuring all parts of the contract have been performed.
You won’t see any cash exchange hands; rather, you’ll be busy signing a number of important closing documents. A good closing agent will explain each one to you as you go along.
At your closing:
- Title and mortgage liens are properly recorded.
- Title insurance is provided.
- Old and new lender instructions are obtained.
- Any problems noted at the walk-through are resolved.
- Deeds of trust or mortgage and accompanying note are reviewed.
- Lender forms and settlement sheets are explained.
After signing all the necessary documents, you’ll provide a certified or cashier’s check to cover your down payment and closing costs, which typically include the appraisal fee, homeowners insurance, and other fees.
At the closing meeting, you will receive:
- A HUD-1 Settlement Statement, listing all the services and charges to you and the seller. You’ll be able to see this document the day before closing.
- A Truth-in-Lending statement. You should have received this within three days of applying for the loan. It details the actual cost of the mortgage.
- The mortgage note itself.This is your promise to repay the loan.
- The deed. Signed by the seller at closing, it transfers ownership of the property. You may only get a copy. When the actual deed is recorded with the country listing you as the owner, it will be mailed to you
- Any other affidavits. For example, an affidavit may state that you will use the property as your principal residence.
Preparing for Closing costs
Typically, closing costs are 3 to 6 percent of the sales price. There are fees such as insurance on the title to your home, taxes, transfer costs, attorney fees (if necessary) and hazard insurance. However, if paying cash you closing costs should be closer to $3,000.
You may also be required to prepay an up-front reserve account of tax and insurance payments to ensure that there are sufficient funds in your account to meet these obligations when they are due.